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How I got started to save money

The first step to saving money was to track everything I spend everyday. And I mean EVERYTHING, every pop for a pop machine, every pack of gum, every ATM service fee, everything. I saved every receipt everyday, and also made sure I kept a small pad of paper and pen with me for anything that didn’t have a receipt. I set up a spreadsheet using openoffice (a FREE alternative to microsoft exel) and everyday when I got home I went thru my notes and receipts and entered them.

I found it useful to break things out into a few categories: groceries and household consumables, entertainment and eating out, healthcare, transportation, and clothing. After looking at a week or two of expenses, its very easy to see where to cut down on costs. Its good to make it a game, see if you can spend less each week until you get it down to the bare bones. For me the easiest place to start saving money was in the entertainment and eating out category. I work in downtown Chicago, and just switching from eating lunch out everyday to brown bagging it saved me $50 a week. I am fortunate in that I am not a coffee drinker and didn’t get swept up in the whole starbucks craze, but it amazes me the amount of coworker I have that drop $8-$10 a day at that place.

Only get as cheap as you can feel comfortable with. Some people just wont be able to bring themselves to stop having the daily starbucks, but try to cut back, maybe skip one day a week.

So start your spreadsheet and start tracking that spending, you will be amazed at how much you spend on little stuff.